What is the significance of a 'Non-Renewal' in the context of All States M.E.D. franchised outlets?
All_States_M_E_D Franchise · 2024 FDDAnswer from 2024 FDD Document
of the names of all current franchisees and the address and telephone number of each of their outlets.
Exhibit G-2 contains a list of the names, city and state, and current business telephone number, or if unknown, the last known home telephone number of every franchisee who had an outlet terminated, canceled, not renewed, or otherwise voluntarily or involuntarily ceased to do business under the franchise agreement during our most recently completed fiscal year or who have not communicated with us within 10 weeks of the Issuance Date of this Disclosure Document. If you buy this franchise, your contact information may be disclosed to other buyers when you leave the franchise system.
During the last three fiscal years, no current or former franchisees have signed confidentiality clauses that restrict them from discussing with you their experiences as a franchisee in our franchise system.
We are not aware of any trademark-specific franchisee organizations associated with the franchise system being offered.
ITEM 21. FINANCIAL STATEMENTS
Exhibit F contains our audited financial statements as of December 31, 2023 and August 15, 2023. We have not been in business for three years and so cannot include all financial statements required by the FTC Franchise Rule. Our fiscal year end is December 31.
ITEM 22. CONTRACTS
The following contracts are attached to this Disclosure Document:
Exhibit C FRANCHISE AGREEMENT
Schedule 1-General Release
Schedule 2-Nondisclosure and Non-Competition Agreement
Schedule 3-Unlimited Guaranty and Assumption of Obligations
Schedule 4-Lease Addendum
Schedule 5-ACH Payment Agreement
Schedule 6-Holders of Legal or Beneficial Interest in Franchisee; Officers;
Source: Item 20 — OUTLETS AND FRANCHISEE INFORMATION (FDD pages 42–43)
What This Means (2024 FDD)
According to All States M.E.D.'s 2024 Franchise Disclosure Document, a 'Non-Renewal' signifies that a franchise agreement has expired and All States M.E.D. has chosen not to extend the agreement for another term. This means the franchisee must cease operating under the All States M.E.D. brand and system. The FDD indicates that Exhibit G-2 contains a list of franchisees who were not renewed.
For a prospective All States M.E.D. franchisee, understanding the conditions under which a franchise may not be renewed is crucial. Non-renewal can occur for various reasons, such as failure to meet performance standards, violation of the franchise agreement terms, or a strategic decision by All States M.E.D. not to continue operations in a particular location. It is important to review the franchise agreement carefully to understand the specific causes for non-renewal and the franchisee's rights and obligations in such a situation.
The FDD data from 2021 to 2023 shows '0' Non-Renewals for Massachusetts. This suggests that, at least historically, All States M.E.D. has not frequently declined to renew franchise agreements. However, this does not guarantee future renewals, as business conditions and franchisee performance can change. A prospective franchisee should inquire about the typical length of the franchise term and the criteria All States M.E.D. uses to evaluate renewal applications.
Furthermore, the FDD states that if a franchisee leaves the All States M.E.D. system, their contact information may be disclosed to other potential buyers. This could be a positive aspect, as it allows for open communication and the sharing of experiences within the All States M.E.D. franchise network. However, it also underscores the importance of understanding the reasons behind any non-renewals or terminations, as these insights can provide valuable information about the potential challenges and rewards of operating an All States M.E.D. franchise.